"A regional intergovernmental organisation of 5 Partner States:" Burundi, Kenya, Rwanda, Tanzania, and Uganda. It was notified to the WTO as a customs union and aims to become a common market and a monetary union as well.

"A leading Development finance institution with an overriding objective of promoting development in East Africa," EADB is a development bank for its five member countries: Burundi, Kenya, Rwanda, Tanzania, and Uganda.

A meeting of the heads of state of 18 countries initiated by ASEAN to discuss issues of common interest. The first of these meetings was held in 2005 in Kuala Lumpur. It has met approximately annually in different locations within ASEAN. The 10th meeting was held in Kuala Lumpur in November 2015.

A set of equations that have been estimated by econometric methods and that are then used, together, to forecast the economy or to calculate effects of changes in the economy. Thus, an economic model whose equations are econometrically estimated.

Econometrics

The application of statistical methods to the empirical estimation of economic relationships. Econometric analysis is used extensively in international economics to estimate relationships of international trade, exchange rates, and international capital movements.

Regional development commission of the United Nations that deals with Asia and the Pacific. It works in three main areas: poverty reduction; managing globalization; and tackling emerging social issues.

Regional development commission of the United Nations that deals with Western Asia. Its purpose, like the other regional commissions, is to promote cooperation and integration among the countries in the region.

This could mean many things, including any of the many ways that countries work together in the economic sphere to achieve mutual objectives. Most commonly, it means reducing barriers to trade and international investment and pursuing means to encourage economic growth.

Economic cost

The monetary cost of an object or action, including reductions in wages, profits, and property values, but not including such nonmonetary costs as adverse consequences for health or safety, or negative effects on others.

Economic crisis

Although there are many economic events that might be called crises, this term usually refers to a sudden drop in aggregate demand that, if prolonged, leads to recession.

Economic decision

A decision about an economic issue, most commonly about how to allocate resources among multiple purposes.

Economic development

Sustained increase in the economic standard of living of a country's population, normally accomplished by increasing its stocks of physical and human capital and improving technology.

Economic efficiency

The extent to which a given set of resources is being allocated across uses or activities in a manner that maximizes whatever value they are intended to produce, such as output, market value, or utility. Contrasts with engineering efficiency, which focuses within a single activity on the output it produces per unit input.

Any of the considerations that are relevant to a decision and that involve economic variables, such as prices and wages.

Economic freedom

Freedom to engage in economic transactions, without government interference but with government support of the institutions necessary for that freedom, including rule of law, sound money, and open markets.

Economic geography

1. The study of the determinants and effects of the spatial distribution of economic activity.
2. See New Economic Geography.

Economic growth

The increase over time in the capacity of an economy to produce goods and services and (ideally) to improve the well-being of its citizens.

Economic indicator

A variable that is measured and publicly reported, and that is considered meaningful not only for itself but as a sign of how rapidly the larger economy is expanding or contracting.

The extent to which economic performance (GDP, inflation, unemployment, etc.) in one country depends positively or negatively on performance in other countries.

Economic justice

1. Fairness and equity in economic affairs, presumably by having laws, governments, and institutions that treat people equally and avoid favoring particular individuals or groups.
2. As most often used, the term carries a connotation that economic justice can only be achieved by lessening the power and changing the practices of international financial institutions, transnational corporations, and rich-country governments.

Economic migrant

A person who relocates to another country in order to benefit from better economic conditions there, such as a higher wage.

Economic model

A collection of assumptions, often expressed as equations relating variables, from which inferences can be derived about economic behavior and performance.

Economic nationalism

A preference for supporting a country's own firms, industries, and workers -- and, in the case of firms and other assets, keeping them owned within the country -- even at the expense of the economic gains that could be had from trade and international investment.

Economic activity that involves participants from two countries, most obviously trade but possibly other forms as well. Some pairs of countries that have essentially no political relations nonetheless have economic relations.

Self-described as a "private, non-profit, non-partisan public policy research organization dedicated to assuring that globalization works with market forces to achieve maximum benefits rather than distorting markets, and imposing costs." Seems to be mainly an outlet for the views Clyde Prestowitz, its president.

Economic structure

The major features of a country or region's economy, including what and how much it produces and trades, and how it spends its income.

Economic summit

A meeting, usually of government leaders, to discuss economic conditions and policies. In the international context, these are most prominently the meetings of heads of state of the G-20 or, previously, the G-7 or G-8.

Economic union

A common market with the added feature that additional policies -- monetary, fiscal, welfare -- are also harmonized across the member countries.

Economic variable

Any economic magnitude the size of which may change and is subject to explanation by an economic model. Examples are endless, including consumption, the price of a good, the exchange rate, the tax receipts of a government, the number of children per family, etc.

Economic vulnerability

The extent of a country's exposure to lost sales and especially lost supplies of needed products due to changes in foreign markets and foreign policies. Vulnerability rises with increased openness, but depends (negatively) also on diversification and on the political relations a country has with its trading partners.

A "sister publication" of The Economist, it provides data and analysis on countries and industries of the world.

Economy

A large group of economic agents, including consumers, firms, and perhaps governments, who engage in selling and buying the goods and services that they produce and consume. Usually associated with a country or other political and/or geographic unit.

This term normally refers, often only implicitly, to the effect of a change in some policy or other exogenous variable that will increase the quantity of trade. Since in trade models, trade itself is endogenous, the effects associated with a change in trade depend on what caused it.

Effective exchange rate

An index of a currency's value relative to a group (or basket) of other currencies, where the currencies in the basket are given weights based on the amount of trade between the countries that use the currencies. Also called a trade-weighted exchange rate.

Effective protection

The concept that the protection provided to an industry depends on the tariffs and other trade barriers on both its inputs and its outputs, since a tariff on inputs raises cost. Measured by the effective rate of protection.

A measure of protection provided to an industry by the entire structure of tariffs, taking account of tariffs on inputs as well as on outputs. Letting bij be the share of input i in the value of output j, and tk be the tariff on good k, k=i,j, the ERP of industry j is ERPj = (tj−Σibijti)/(1−Σibij).
Due to Corden (1966).

A unit of a factor, usually labor, with the same productivity as some benchmark. Thus, if country A has LA units of labor that are only 1/4 as productive as labor in country B, then using B's labor as benchmark, A has only LA/4 efficiency units of labor. The assumption of equal productivity can then be used.

Efficient allocation

An allocation that it is impossible unambiguously to improve upon, in the sense of producing more of one good (or more utility for one consumer) without producing less of another (or for another consumer).

Efficient breach

The violation of a rule or law when the benefit to the violator of doing so exceeds the harm that it does to others. It is argued that a system of rules, such as the GATT and WTO, should allow for efficient breach by, perhaps, allowing violation of its rules in return for compensation of those who are harmed.

Efficient capital market

An asset market in which, at a minimum, current price changes are independent of past price changes, or, more strongly, price reflects all (publicly) available information. Some believe foreign exchange markets to be efficient, which in turn implies that future exchange rates cannot profitably be predicted.

In a market with undistorted supply and demand, the quantity at which the supply price equals the demand price. That quantity is efficient, because supply price is the marginal cost and demand price the marginal benefit of an additional unit.

A measure of responsiveness of one economic variable to another -- often responsiveness of quantity to price along a supply or demand curve -- comparing percentage changes (%Δ) or changes in logarithms (d ln). The arc elasticity of x with respect to y is ε = %Δx/%Δy. The point elasticity is ε = d lnx/d lny =&nbsp(y/x)(dx/dy).

The elasticity of the ratio of two inputs to a production (or utility) function with respect to the ratio of their marginal products (or marginal utilities). With competitive demands, this is also the elasticity with respect to their price ratio. For example, with factors L,K and factor prices w,r, the elasticity of substitution of a production function F(K,L) is σ = (wL/rK)d(K/L)/d(w/r).

Elasticity of transformation

The elasticity of an economy's output of one good with respect to its output of another along its transformation curve (holding other outputs, if there are any, constant).

The prohibition of some category of trade. May apply to exports and/or imports, of particular products or of all trade, vis a vis the world or a particular country or countries.

Emerging economy

1. Originally this term was applied to countries that had recently ceased to be part of the Soviet Union and its satellites, and thus emerging from centrally plannedcommunist economies. The term drew attention to their transition to becoming market economies.
2. Rather quickly, perhaps acknowledging the importance of central planning and the failure of markets in many other countries, the term has expanded to encompass also developing countries, not necessarily ever communist, as they expanded the role of markets.

Emerging market

1. Term coined in the early 1980s by World Bank economist Antoine van Agtmael to describe "economies with low-to-middle per capita income" (according to Financial Times Oct 20, 2006).
2. Same as emerging economy.
3. The securities market of an emerging economy.

Something that is observed from real-world observation or data, in contrast to something that is deduced from theory.

Employment

People working for pay or in a family-owned enterprise or farm. Much more specific definitions are used for measuring employment by national statistical agencies such as the US Bureau of Labor Statistics. Contrasts with unemployment.

Employment argument for protection

The use of a tariff or other trade restriction to promote employment, either in the economy at large or in a particular industry. This is a second best argument, since other policies -- such as a fiscal stimulus or a production subsidy -- could achieve the same effect at lower economic cost.

An economic variable that is determined within a model. It is therefore not subject to direct manipulation by the modeler, since that would override the model. In trade models, the quantity of trade itself is almost always endogenous. Contrasts with exogenous variable.

Endowment

The amount of something that a person or country simply has, rather than their having somehow to acquire it. In the H-O Model of trade theory, endowments refer to primary factors of production, ignoring the fact that some of them -- especially capital and skill -- are deliberately accumulated.

Term sometimes used to describe the role that exports may have played in economic development, both of some of the regions of recent settlement in the 19th century and of the more recent NICs. Due to Robertson (1938).

1. Begun in June 1990 under US President H. W. Bush, this intended to create a FTA covering most of the Western Hemisphere, and to promote FDI and debt relief. The trade objective was succeeded by the planned FTAA.
2. The EAI now is a program for providing assistance to Latin America within USAID.

Enterprise zone

1. A location that is granted special treatment (such as lower or zero taxes) by government in order to encourage economic activity.
2. An export processing zone.

Entrepôt trade

The import and then export of a good without further processing, usually passing through an entrepôt which is a storage facility from which goods are distributed. See re-exports.

A natural or artificial impediment to a firm beginning to operate in an industry. Entry barriers give a first mover advantage to firms already in an industry, and these are often national firms in competition with potential foreign entrants.

Entry writer

An employee of a customs brokerage whose job is to prepare customs declarations, including finding the correct tariff treatment of an imported good by identifying its proper classification.

Envelope

The outermost points traced out by a moving curve.

Environmental dumping

Export of a good from a country with weak or poorly enforced environmental regulations, reflecting the idea that the exporter's cost of production is below the true cost to society, providing an unfair advantage in international trade. Also called eco-dumping.

The view that trade should be restricted in order to help the environment. Examples include embargos on imports made from endangered species, limits on imports produced by methods harmful to the atmosphere, and restrictions on investment into locations with lax environmental standards. Usually a second best argument.

Environmental subsidy

A subsidy intended for environmental purposes. A subsidy for adapting existing facilities to new environmental laws or regulations is non-actionable under WTO rules.

M×V = P×Q, where M is the quantity of money in an economy, V is the velocity of money, P is the price level, and Q is the real output of the economy. The equation is true by definition because it implicitly defines velocity of money. It is central to the quantity theory of money.

Equilibrium

1. A state of balance between offsetting forces for change, so that no change occurs.
2. In competitive markets, equality of quantity supplied and quantity demanded.

Equilibrium exchange rate

This is ambiguous, since there is no single agreed upon model of the exchange rate:
1. The exchange rate at which supply and demand for a currency are equal.
2. The exchange rate at which there is balance of payments equilibrium.
3. The exchange rate at which purchasing power parity holds, in some form.
4. The exchange rate at which the expected change in the exchange rate, in the near future, is zero.
5. The exchange rate at which the country's international reserves are neither rising nor falling.

Equilibrium level

The value taken on by an economic variable in equilibrium, as opposed either to some other value, or to its rate of change.

Equilibrium position

Same as equilibrium level, though perhaps of several variables at once, perhaps as displayed in a graph.

Equilibrium terms of trade

The terms of trade at which the country's excess supply of each good to the world market equals the world market's excess demand. If the country is a small open economy, whose excess supplies and demands are therefore negligible for the world market, then this is simply calculated from given world prices.

Equity

Share in the ownership of a corporation; more commonly called a stock, as in the stock market.

Equivalent quota

The quota that sets the same level of imports that is entering a country under a tariff, or perhaps under some other NTB.

The amount of money that, paid to a person, group, or whole economy, would make them as well off as a specified change in the economy. Provides a monetary measure of the welfare effect of that change that is similar to, but not in general the same as, compensating variation.

Era of Good Feelings

The period in US history that began after the War of 1812 and the election of 1816, during which a single party, the Democratic-Republicans, dominated US politics and based policies on the objective of national economic development. These policies included high protective tariffs to support American manufactures.

1. The portion of a legal text that permits departure from its provisions in the event of specified adverse circumstances.
2. The U.S. statute (section 201, 1974 trade act) that permits imports to be restricted, for a limited time and on a nondiscriminatory basis, if they have caused injury to U.S. firms or workers. The escape clause accords with the Safeguards Clause (Article XIX) of the GATT.

This is the mathematical context of most economic models: a space of all n-tuples of real numbers. Each point in that space is a vector, the elements of which can take on any values, positive, negative, or zero. In a 2-good trade model, for example, the trade vectors occupy 2-dimensional Euclidean space.

A declaration at a 1995 conference in Barcelona between the 15 members of the European Union and its 12 Mediterranean partners to enter a new phase in their relationship, promoting peace and stability, free trade, and cultural understanding. Also called the Barcelona Process.

Euro Zone

The countries of the EMU. That is, the group of European countries, members of the EU, that adopted the common currency, the euro. See baffling pigs.

Eurobond

A bond that is issued outside of the jurisdiction of any single country, denominated in a eurocurrency.

A European network of NGOs working to reduce poverty and empower the poor in developing countries through improved economic and financial policies.

Eurodollar

Originally referred to U.S. dollar-denominated deposits in commercial banks located in Europe. Over time, the term came to include deposits in a commercial bank in any country denominated in any currency other than that of the country. Now sometimes called eurocurrencies.

Europe 1992

An initiative, begun with the Single European Act in 1987 by the European Union, to fully integrate the markets of the member countries by the end of 1992. The process involved extensive harmonization of laws and regulations that would otherwise interfere with the cross-border movement of goods and services.

Europe à la carte

A form of variable geometry in which countries may choose from a list of policies, like a menu, rather than all being required to adopt the same policies.

Europe Agreement

An agreement between the EU and each of ten Eastern European countries (starting with Hungary and Poland in 1994) creating free trade areas and establishing additional forms of political and economic cooperation in preparation for these countries' eventual membership in the EU.

The highest decision-making body of the European Union. The Commission, which consists of one Commissioner from each member country, proposes legislation and "ensures that EU law is correctly applied by member countries."

A body, including the heads of state of the member countries of the EU, which "defines the EU's overall political direction and priorities." It also includes the European Council President and the President of the European Commission.

The customs union formed in 1958 by the Treaty of Rome among six countries of Europe: Belgium, France, Germany, Italy, Luxembourg, and the Netherlands; predecessor to the EC in 1967 and the EU in 1992.

A free trade area made up of countries in Europe that did not join the European Economic Community. EFTA was established in 1960 among Austria, Denmark, Norway, Portugal, Sweden, Switzerland, and the United Kingdom. As of 2016 it included Iceland, Liechtenstein, Norway, and Switzerland.

The "long-term lending bank of the European Union." It supports projects within the member states as well as in countries that are working to become members states of the EU.

European Monetary Agreement

An intergovernmental organization administered by the OECD that facilitated settlement of balance of payments accounts among its member states from 1958 to 1972. It replaced the EPU, and its functions were taken over by the IMF in 1972.

European Monetary Institute

A temporary institution that existed from January 1994 to June 1998 during the years leading up to the European Central Bank and the introduction of the euro. It's purpose was to facilitate cooperation and coordination among the central banks of the EU and to pave the way for the shift to the euro.

European Monetary System

A currency union formed by some of the members of the EEC in 1979 that continued, with changing membership, until replaced by the EMU and the euro in 1999.

An international arrangement for settling payments among member countries in Europe during a period in which many of the countries' currencies were not convertible. The EPU functioned from 1950 to 1958, after which it was replaced by the EMA.

A group of European countries that have chosen to integrate many of their economic activities, including forming a customs union and harmonizing many of their rules and regulations. Preceded by EEC and EC. As of January 2016, the EU had 28 member countries.

In international trade models with multiple goods and factors, this is the special case of an equal number of goods and factors. It is convenient for analysis, because the matrix of factor input requirements is square and therefore potentially invertible.

Everything But Arms

The name given by the EU to its decision in 2001 to eliminate quotas and tariffs on all products except arms from the world's poorest countries. As of October 2014, the beneficiaries included 49 countries.

An international NGO composed of "corporate, government and opinion leaders, committed to fostering an open, inclusive, equitable and sustainable global market economy in a rules-based multilateral framework."

Ex ante

Before the fact; that is, before some event has taken place.

Ex ante analysis

Analysis of the effects of a policy, such as trade liberalization or formation of a PTA, based only on information available before the policy is undertaken. Also prospective analysis.

Ex factory

Applied to a price, this means the price at the factory, and does not include any other charges, such as delivery or subsequent taxes.

Ex post

After the fact; that is, after some event has taken place.

Ex post analysis

Analysis of the effects of a policy, such as trade liberalization or formation of a PTA, based on information available after the policy has been implemented and its performance observed. Also retrospective analysis.

Also called an exchange equalization account, this is the unit within a government or central bank that manages a pegged exchange rate. It manages reserves of foreign currencies, which it uses to buy and sell domestic currency as needed to keep the exchange rate within specified bounds.

Exchange market

1. A term encompassing all places and mechanisms at and by which national currencies are exchanged for one another.
2. The the more narrowly defined actual exchange market, which exists primarily among large international banks. Others who wish to exchange currencies do it through these banks.
3. The theoretical representation of the exchange market as either the interaction of supply and demand arising from exchange-market transactions or as an asset market equilibrium between currencies.

The price at which one country's currency trades for another, typically on the exchange market. Depending on context, it may be the price of either currency in terms of the other. A "country's exchange rate" may be the foreign currency price of its currency or the opposite. One must be careful.

Exchange rate disconnect puzzle

The name given by Obstfeld and Rogoff (2001) to "the exceedingly weak relationship (except, perhaps, in the longer run) between the exchange rate and virtually any macroeconomic aggregates."

The extent to which the stock-market value of a firm varies with changes in exchange rates. Also called economic exposure.

Exchange Rate Mechanism

1. A system that was operated by some central banks within the European Union, which intervened in exchange markets to limit the fluctuations of their currencies relative to one another, while letting all of them collectively float.
2.ERM II is the successor to the original ERM and was set up in 1999 to reduce fluctuations in exchange rates of non-euro EU currencies with respect to the euro. Participation in ERM II for at least two years is required for countries before they can adopt the euro.

Manipulation of the exchange rate to increase the domestic prices of foreign goods, and thus demand for domestic goods. Since an undervalued currency stimulates demand for all domestic tradable goods, such protection, unlike tariff protection, cannot be provided to individual industries.

Uncertainty about the value of a financial commitment due to uncertainty about a future exchange rate. Unless they cover themselves, traders, creditors, and debtors with future commitments to pay or receive foreign currency bear exchange risk. Contrasts with commercial risk and political risk.

Exchange stabilization fund

A government institution sometimes used to handle exchange market intervention, charged with the explicit function of smoothing exchange rate fluctuations.

Excise subsidy

A subsidy paid on production or sale (consumption) of a particular good.

A 1988 US law empowering the president to stop a foreign acquisition of a US company (or a merger) if it threatens national security. An amendment to the Omnibus Trade and Competitiveness Act of 1988, it was sponsored by Nebraska Senator J. James Exon and New Jersey Representative James J. Florio.

Exorbitant privilege

Term of Valery Giscard d'Estaing in the 1960s for the US position in the international monetary system, the Bretton Woods System of currencies pegged to the US dollar. The US benefited then, and still does, as the issuer of the currency that most countries hold as international reserves.

Tending to cause aggregate output (GDP) and/or the price level to rise. Term is typically applied to monetary policy (an increase in the money supply or a decrease in interest rates) and to fiscal policy (an increase in government spending or a tax cut), but may also apply to other macroeconomic shocks. Contrasts contractionary.

Expectation

The expectation of a variable is the same as its expected value, and is also used with both meanings.

Expected value

1. The mathematical expected value of a random variable. Equals the sum (or integral) of the values that are possible for it, each multiplied by its probability.
2. What people think a variable is going to be. In general, the expectation in this second sense may be more important than the first for determining behavior on a market, such as the exchange market.

Expenditure function

A function representing the minimum expenditure needed, at a given price vector P, to achieve a given utility U from a vector of goods consumed X: E(P,U) = minX{PX | U(X)≥U}. Useful for using its partial derivatives to conveniently represent quantities demanded.

Expenditure share

The fraction of expenditure (usually consumer expenditure) that is spent on a particular good or purpose. With Cobb-Douglas preferences, expenditure shares are constant, independent of prices and income.

Experience good

A product whose value can be better known after having consumed it. Producers of experience goods may temporarily charge a price lower than marginal cost to induce buyers to try the product. Done with an export, this would be legally considered dumping.

Exploit

1. To take advantage of someone or something for one's own benefit. Economists often use the term with a neutral or positive connotation, advocating that one should fully exploit one's resources for example.
2. Others see the term as quite negative, viewing exploitation as being done at the expense of others, which in some cases (e.g., monopsony, especially of labor) it is.

Export

1. A good that moves outward across a country's border for commercial purposes.
2. A product, which might be a service, that is provided to foreigners by a domestic producer.
3. To cause a good or service to be an export under definitions 1 and/or 2.

Export bias

Any bias in favor of exporting. Most often applied to growth that is based disproportionately on accumulation of the factor used intensively in the export industry and/or technological progress favoring that industry.

Regulation or restriction of the export of certain goods, sometimes in order to limit access to the sensitive technologies they embody, sometimes to alleviate domestic shortages.

Export credit

A loan to the buyer of an export, extended by the exporting firm when shipping the good prior to payment, or by a facility of the exporting country's government. In the latter case, by setting a low interest rate on such loans, a country can indirectly subsidize exports.

This could be any of several elasticities, including that of demand for, or supply of, a country's exports, either total or for particular products, with respect to particular prices or income.

Export elasticity of substitution

This is the elasticity of substitution in demand for a country's exports of a product relative to the exports of another country of that product, both to a particular importing country, with respect to the relative price of the two exporting countries' exports.

Export Enhancement Program

A program of the US Department of Agriculture to provide export subsidies for particular products, intended to "meet the competition from subsidizing countries," especially the European Union. It began in 1985, was inactive after 2002, and was repealed in the 2008 farm bill.

Export facilitation

Anything intended to make it easier to export, but usually refers to government services or programs with this objective.

Export factoring

The sale by an exporter of an accounts receivable (the foreign importer's commitment to pay), at a discount, to another entity -- the export factor -- for immediate payment. Similar to forfaiting.

Export guaranty

The promise by an exporter's government to a private lender that it will repay the loan if the buyer of the export does not.

Official export credit agency of the US government, the Exim Bank assists financing of US exports, both goods and services. It says it does not compete with private-sector financing, but "fills gaps" by assuming credit and country risks that the private sector does not accept. Created in 1934, its continuation was interrupted in 2015 but then resumed.

Export-import company

A firm whose business consists mainly of international trade: buying goods in one country and selling them in another, thus both exporting and importing. Same as import-export company.

Export incentive

A government program that makes it more attractive for a firm, industry, or country to export. Most simply, an export subsidy.

Export instability

Frequent and large fluctuations, over time, in the quantity and/or value of a country's exports, either individually or in aggregate.

Export insurance

Insurance available to those who export to cover risks such as damage to the product in transit, nonpayment, and political risks.

Export intensity

The fraction of the output of a firm, or sometimes of an industry within a country, that is exported.

A firm that handles the process of exporting for other firms. It may do this for a commission or fee, or it may purchase the goods for subsequent sale.

Export multiplier

The multiplier for a change in exports; that is, the increase in GDP caused by a one-unit increase in exports.

Export parity price

The price a producer gets or can expect to get for its product if exported, equal to the f.o.b. price minus the cost of getting the product from the farm or factory to the border. This and the import parity price together define a range of the possible equilibrium prices for an equivalent domestically produced good.

Export penetration

The ability of domestic producers to penetrate foreign markets, as measured by the ratio of exports to output of a domestic firm or industry.

The use by firms from one country of a 2nd country or region as a place to produce for export to a 3rd country. Used especially when a preferential trade arrangement provides easier access to the 3rd country from the 2nd country than from the 1st.

A designated area in a country in which production for export is encouraged, usually by special tax treatment and by permitting firms to import duty-free so long as the imports are used as inputs to production of export. Thus a free trade zone with additional inducements to export.

A quantitative restriction on exports, sometimes the means of implementing a VER.

Export quota agreement

An agreement among a group of exporters of a product to limit output and divide the market, each promising not to exceed its quota. Used by a cartel to stabilize and raise price, and thus raise the incomes of the participants.

Export requirement

A requirement by the government of the host country of FDI that the investor export a certain amount or percentage of its output.

1. A subsidy to exports; that is, a payment to exporters of a good per unit of the good exported. Contrasts with a domestic subsidy.
2. Sometimes applied to any payments or other advantages given to producers that lead to an increase in exports.

Export substitution

1. Export promotion; thus the substitution of production for export in place of production for the domestic market. Contrasts with import substitution.
2. Export of more processed forms of a good instead of only exporting the raw material.

The protective effect that rules of origin have on the partner country's input producers when applied to a country's imports within a free trade area. Term appeared first in a 1993 working paper version of Krueger (2001).

1. Refers to varying the amount of trade (or other activity) of a firm, industry, or country by varying the number of products that it trades, as opposed to the intensive margin at which it would vary the quantities of a given number of products.
2. May also (or instead) refer to varying the number of firms that produce or trade, as opposed to the amounts done by a given number of firms.

An effect of one economic agent's actions on another, such that one agent's decisions make another better or worse off by changing their utility or cost. Beneficial effects are positive externalities; harmful ones are negative externalities.